 Live from Las Vegas, it's theCUBE. Covering Discover 2016 Las Vegas. Brought to you by Hewlett Packard Enterprise. Now, here are your hosts, John Furrier and Dave Vellante. Hey, welcome back everyone. We are here live in HP Discover for theCUBE. It's our flagship program. We're out to the event, extract the signal from the noise. Our next guest is Don Jones and Duncan Campbell. Welcome back to theCUBE guys. Good to see you again. Last time we saw you was HP Discover in London right after the split. Everyone had a spring in their step. Okay, all steam ahead. That's right. HP Discover 2016 here at Las Vegas. The big show in the States. You still have a spring in your step. You got a spring in your step. Good sign. I mean, this is about the same kind of messages but a little bit up level in terms of speed, data. We heard a lot of the stuff around data at the center of the value proposition. But also, Meg said something in the keynote. I want to bring this up because this is the topic of our segment is really the relationships in the ecosystem. She said around ES, talking about the ES spin out and then TS technology services or technical services. I think technology services. Scott Welles group, that's the crown jewel. So clearly, and we hear this at Sapphire and all the other events, the cloud game is about integration. It's about value creation. That's going to be about bringing it all together. And integration is not kind of talk. It's not as sexy as kind of outcomes or solutions. But that's where the game is being played. So you're seeing the crown jewel being the partnerships, the alliances. Don, I mean, what's going on? I mean, this is a game changer because operating models are changing for the customers. So that means the relationships on how they get delivered, how you guys form your partnerships is changing. So give us the update. Well, first off, thanks for having me back. It was a great time in Discover London. And as you can see, we're ready to do it again here in Las Vegas. And you're right. The partnerships that HP is driving are becoming much more important than they ever have. And they'll be more so after the ESC, ESC-SC spin out and merge. A great example today was the announcement we did with Docker. When I was with you in London, I mentioned this incubation partner team that we were building. And the idea is to take these young, fast, hot start-ups and really mature them quickly to leverage the best of HP, which is our massive channel, our massive go-to-market ability, with their great technology. So we were pleased to be the industry's first Docker container platform that was announced today. So I've got to ask you about Docker. That brings up a whole microservices. You go to the cloud, mention the SIs and a lot of alliances are changing around it. A lot of people are saying, how early are we in this shift over to the dockerization, all these fasts? We had Dropbox up on the stage, which shows that companies are maturing, certainly a start-up, kind of a unicorn. How early are we? Because Duncan, you know from the early days of HP, HP wasn't number one in the PC business. And then Catapult was number one. In fact, their PC Vectra was viewed as kind of like, I mean, you sold one, everyone got a bottle of champagne. But then they had a poll, it's a number one. So you don't have to be first to be a winner. Just because the cloud native stuff was early, it still hasn't really taken off or has it. So how early are we for customers? Maybe if I can jump in, I think it's important to understand just how fast the market's moving now. So Meg says, the future belongs to the fast. And so that is another reason why us getting out early with Docker, working together from an engineering standpoint, from a go-to-market standpoint, has been pivotal. So the good news is we're out there fast. We're out here making big news in the desert here. And I think that this is just a great sign of the things that we're doing across the board in our lenses. How early are we in the progress bar? You've seen these cycles before. What's your color on how early you are? I know it's faster changing market, but it's still early days. Isn't it? Well, the one thing that I would say, you got to look at it by industry and by how people are looking from an innovation standpoint. So I would be careful to say that we're early and way ahead. I think this is a market that's moving fundamentally very fast. HP is out in front and up from our standpoint. I think it's more from a broader standpoint of what we're doing in alliances that's important. We're taking an overall HPE type of approach easier to do business with now the partner can engage faster. And that's really what we did here with Docker. So it's crossed the board, not just a silo by silo, but fundamentally from an HP standpoint, bring that whole onslaught of resources to bear. So what's the algorithm, if you will, in terms of getting value out of partnerships? You've got this huge portfolio of partners. And you have to reassess that portfolio probably more and more lately. How do you guys approach that? And how do you decide and determine how you're going to get value out of those partnerships? Let me answer that and build on it a little bit. So if you think about, I was with one of the CEO, one of the largest telcos, about two weeks ago. And he made the point to me that his landline business evaporated in a span of three years. So when I think about how fast these things can go, it can be three years to go from landline completely gone, primarily largely gone, to being up here in mobile play. And we've got to think about that in the same way as part of our alliance strategy. So there are certain big alliance partners that will be important to us for the foreseeable future, the Microsoft, the Accenture, the Deloitte, the SAPs. We've also got to have this incubation idea. So you saw about a month ago, we announced HP Ventures or our Pathfinder program to really make investments kind of series B investments in that ecosystem. On top of that, as you go up the stack, you start targeting your alliance partners with incubating solutions like Docker, Mesosphere, that list, and then bring those to market through HP's massive channel. And then on top of that, of course, it's these mega-partners that are going to be long-term, incredibly strategic to the industry and to HP as a whole. Yeah, and maybe to build on what Don's saying, I think it goes to show that we feel that the ecosystems are now key. So it's funny, you go out here on the show floor and some of the smaller guys go, hey, we're pretty important now, and the fact matters, yes they are. So when you think about the whole ecosystem, it's both the advisory service, it's the innovation engine, and then the go-to-mark-and-force multiplier that we want to have, but it's all, again, aligned to our strategy, that's where it starts around the transformation areas. The ecosystem, I couldn't agree with you more, I think the ecosystem is critical because if you look at the entrepreneurial landscape, it's fast too, fast or die, it's kind of like we're seeing out there, certainly in Silicon Valley on the consumer side, starting to see that the chair's kind of being taken up and people are being sold ahead of CEO, told me the other day that three liquidations phone calls were coming in from startups, couldn't get their series B financing. So if you can't get the revenue, you better be able to stand on your own. So there's going to be some, so often now, I'm not saying that's the general enterprise market dynamic, but the correlation is that there's a ton of enterprise developer opportunities, huge amount of white space. So do you guys see that impacting your strategy on alliances? Is there a new category, back in the old days, ISVs, Vabs, VARs, it buzzwords for all that stuff. Is there a new cloud enterprise developer category? How are you guys seeing this develop? I think you're viewing it exactly right. I mean the DevOps space is just right for the picking and it's growing tremendously across the entire portfolio. Do we have that figured out how we can take that concept or that thread and incubate that up through those? Probably not yet, but we're going to be keeping our eye on for sure. Is there a theme that you guys talk about internally and certainly we hear that from Meg, the messaging that she's saying, because that's kind of high level messaging, but as you get down into the tactical alliance plan, is there a certain element that's the rising tide that you see, certainly cloud and DevOps, but is there something specifically that you see that's going to be that you guys can provide as a rising tide for the ecosystem as it develops? Yeah, well I think what's key here is really within our ISV community, for instance, you have both the things you got to do for the developer side to speed things up and then there's a go to market benefit. So what we're doing now is putting those things together and really doing that since partnering is in our blood okay, in HPE, and we actually do that cohesively now and a lot of these partners want to have the flexibility not to be siloed into one particular discipline. So our overall partner ready program is really a cohesive umbrella for all of them, but to answer your question, it's more the end to end planning we approach, benefits from fast development to deployment and then certainly the monetization around that. So I got to ask you guys, because I know the Dell EMC has been on top of mine, everyone's mine, you've seen a lot of customers kind of like not sure what's going on, Michael Dell tried to clear that up at the EMC world, but EMC was known for a direct sales force. Okay, so one of the people commenting, hey, they're buying basically EMC sales force. HPE has a very, very good sales force, great service organization in Tennessee, great channels and great partnering. How are you guys going to leverage that into the competitive strategy and how are you going to make the ecosystem feel good? I mean, what are some of the things that you're offering to the alliance partners that's going to get behind you guys? Yeah, so a couple of points there. What we're doing basically is putting our customers as our true north. I know that sounds rather fright, but that really is what it's about. You align behind that against our four transformation areas and you've been beaten up with those, so I won't go into each one of those four in detail. Exactly right. You could probably give the... Transform, accelerate, enable. That's the three areas on the floor. The one other. So basically through the transformation areas, customers true north, you then start to triangulate into some really interesting things. What we couldn't do before was say, all right, we're going to make a bet with a specific SI, with a specific partner solution to take it to market and we can do that now. So as an example, we can have a vertical SAP HANA solution for healthcare on HP infrastructure and we're going to make a bet with a central because they're going to be our partner in that space. Where it's historic, we would peanut butter that across all the partners and just be diluted, frankly. We weren't taking advantage of our investment or the partners. So we're starting to make bigger and bigger bets. When we were together in London, we did the Microsoft bet and you saw the Docker bet today and we're going to continue down that path. On the bets, do you see the SI specializing because you're seeing a censure? Yeah, so I think Don brought up something very important, which is really how we're starting to think about go to market and innovating around that. So it really is not just thinking about things in the old way, just like HPE plus a partner. It's more like, we can do better. We can even accelerate this, be more innovative. When you think about combining with an SI from a consulting advisory service, again, with the ISV and then from a deployment standpoint, why does that matter? Cause you could get a force multiplier. You can start to think vertical. And those are things that really at that point start to differentiate our overall program. And from our standpoint, at the end of the day, we really want the overall HPE alliances program to be best in class. The timing is tricky. So take the Docker example. John, John, I remember you called me up. I said, Jerry Chen did his first deal. Who's that Docker? That was years ago. Okay, so, but yet SAP HANA, you guys went in early. Now maybe there were competitive reasons for that or partnership reasons, et cetera, but you knew SAP, okay, great. So how do you differentiate between being too early? You can over rotate into some of the new hot, sexy stuff. What goes into the thinking there? Yeah, so a couple of things. So these decisions aren't made in the vacuum by the alliance guys in any way, shape, or form. If you look at the amount of time that Meg personally spends with these partners, it's actually astronomical. She and Ben, the CEO of Docker, have been together for at least 30 hours, of course, last month. She and the team from Microsoft, she was going to be there Friday of last week. They're super focused from Meg. And that trickles down to the EC as well, right? All of her direct reports. So I can just see Meg and Ben on the whiteboard. They were going at it. They were going at it. But the focus amongst our executive staff on how we partner, how we position those solutions and technologies, and how we show the best of HP. We recently completed, oddly enough, the first ever Alliance Partner Satisfaction Survey. So we asked our partners, where's HP at on this for you? And I was super pleased with some of the comments and less pleased with others. We came out loudly as the partner they trusted the most. And I was incredibly proud of that. I mean, we do what we say and we say we're going to do. What they did say was, it's still hard to do business with the UHP, right? I don't think it's a legacy from our old structure with PPS, EG, ES, and HP software. So we're simplifying things for them as well in that way. So hopefully we're doing all the right things. They're going to get the value out of the partnership that they're investing. What are some of the things you mentioned that you need to work with? Is it economics too? I mean, I can imagine the meetings, you know, that it's what's in it for me kind of attitude. Exactly. What's in it for them? I'm an Alliance Partner. Hey, HP, you're tough to work with, like you guys are working on that. But what's in it for me? How do I win? Yeah. What does that mean? Money, more cash in my pocket, more go-to-market resources. Resources. Yeah, it means all the above. So one, right, there's incremental revenue based on how you partner and partner well. All of these agreements we're doing have very structured business plans. We understand how we're going to make money and some things are going to be in HP-led sales motion. Some of your partner-led sales motion and some will be joint. And getting clarity on that is super important. I think we tripped over ourselves in that in previous years. So point one, who's selling and how do you sell? What's a go-to-market motion look like? So there's that bit. There's incremental revenue and resources that we can bring to invest in the go-to-market solutions that we're building and creating. So both on the innovation side, as well as the go-to-market side. And then finally, it's just the growth that both companies expect based off the investments they're making in those go-to-markets. Yeah. Yeah, the other thing I would add too is they're going to look at their win rate too. So the fact that we're now can really move together as one company with a partner when you increase win rate, that's good news as well. A win rate is a huge metric. I mean, you look at the win rates into the day. That's all rubbing through the relationship. You're feeling each other out. The day-to-day stuff. The win rates ultimately is the scoreboard. Yeah, in our CRM system internally, what we found is if a partner is attached to a deal, win rate is 91%. 91%. I mean, it's just an astounding number. If they're not attached, it's significantly less. My final question before we wrap is, how are you guys dealing with the current dynamic of this now horizontally scalable kind of solution set when partners have, I've got a Microsoft practice over here and I got this practice, you know, Centres and whatnot. They all had practices in the old days. Are they also changing within your alliance partners that they had this practice? Well, I'm the Microsoft practice. Are they stove piping? Are they breaking down those silos? What's the landscape like for the partners? Yeah, yeah, yeah. So one of the things I think that we're really seeing is more kind of a maturity on how we go-to-market and fundamentally, you know, I would give a great example. When you even think about IoT, really the best way to approach that is with the vertical lens. Who's in the best position to do that are our partners. So the SIs in particular, that is expertise with intellectual property and expertise to bring to the table. We do these go-to-market innovations from a triage standpoint. That's a winning hand here in Vegas. Don, I'll give you the last word. Take a minute to share with the audience. What should they know about the alliance strategy and how to do business with HP? Give them the one minute quick overview and we'll wrap it. Yeah, so again, customers are our guiding north, our true north star, if you will, and it's focused on them first and foremost. For our partners, we've got a programmatic approach now to how we manage them, how they work with us, and then we can both grow our revenue together in a way that makes sense for both organizations. And I guess the last point that I would just be really precise about, when we look at what we can do with our partners now that we couldn't do before, it's pretty astounding. And you're seeing that in the results on what the things that we're announcing with Microsoft six months ago, Docker today, and we'll continue down that path in making big bets, big investments, and growing our joint businesses. Don Duncan, thanks for sharing the insights on the alliances. Certainly an opportunity to be competitive advantage for the company, but also more importantly, work with, share the revenue and grow the ecosystem. Thanks so much for sharing the insight of theCUBE. Thanks guys. Silicon Angles, theCUBE. I'm John Furrier with Dave Vellante. We'll be right back. You're watching theCUBE.